Build vs. buy: How equipment dealers, lenders take on new tech

As investment in equipment finance and software grows, equipment dealers and lenders are increasingly faced with deciding between developing in-house software or outsourcing to third parties.  

Equipment and software investment rose nearly 22% in the first quarter as businesses changed purchasing schedules ahead of new tariffs, according to the Equipment Leasing and Finance Foundation’s (ELFF) third-quarter update of the 2025 Equipment Leasing & Finance U.S. Economic Outlook. As a result, ELFF raised its 2025 investment growth forecast to 6.3% from 2.8%. 

Companies should use third-party tech for non-differentiating functions like optical character recognition and e-signing, but build in-house solutions for core competitive competencies, Tawnya Stone, vice president for strategic technology at GreatAmerica Financial Services, said during Equipment Finance News’ webinar on July 17. 

Some capabilities are part of a company’s unique competitive advantage, and in those cases, off-the-shelf solutions either don’t exist or lack the necessary customization, she said. “You’re going to need to do something in-house.” 

Watch “Technologies to Advance Your Equipment Financing Business” here.

Building technological solutions in house also allows companies to develop and adjust their software to fit their needs.  

This is especially true as industry changes — such as new disclosure laws — take effect and require updated technology systems to maintain compliance, John Boy, finance and sales administration manager at Bridgeville, Pa.-based Anderson Equipment, said in the webinar. 

“Instead of calling a help desk at one of these third parties, I get to call Doug in Buffalo, who can actually go into our system and recode it and reprogram it so it allows us to tinker with things a little bit to make them fit exactly what we need.” — John Boy, finanace and sales manager, Anderson Equipment

“It’s all streaming, flowing through the same tree system that we’re using, so it makes it easily integrate-able and workable,” he said.

Mixing buy with build

Jeffry Elliott, founder and chief executive of Elevex Capital, had another take on buy vs build, saying a hybrid strategy is most desirable. 

Using third-party tools like Salesforce and DocuSign, for example, to build initial workflows while gradually developing in-house capabilities and integrations to customize and streamline systems is optimal, he said during the webinar.  

“You don’t want to be totally third-party because you want some in-house expertise to be able to manage things,” he said. “I do recommend utilizing as much third-party tools as possible, and then keep reviewing those.”